Rangatira Annual Report 2023 - Flipbook - Page 44
44
R anga tira Annua l Rep or t 2 0 2 3
Rangatira Group
Notes to the Consolidated
Financial Statements
For the year ended 31 March 2023
Note 1 Reporting Entity and Basis of Preparation
Rangatira Limited is an investment company incorporated and domiciled in New Zealand. Its principal activity is investment. The Group
consists of Rangatira Limited, its subsidiaries and associates.
The consolidated financial statements have been prepared in accordance with generally accepted accounting practice in New
Zealand (NZ GAAP), the Companies Act 1993, and the Financial Reporting Act 2013. They comply with New Zealand equivalents to
International Financial Reporting Standards (NZ IFRS) as appropriate for profit-oriented entities, and with International Financial
Reporting Standards.
The financial statements are presented in New Zealand dollars. All financial information has been rounded to the nearest thousand,
unless otherwise stated.
The measurement basis adopted in the preparation of these financial statements is historical cost, modified by the revaluation of
financial instruments as identified in the specific accounting policies below and the accompanying notes.
Accounting policies and standards
Accounting policies that summarise the measurement basis used and are relevant to the understanding of the financial statements are
provided throughout the accompanying notes.
The accounting policies adopted have been applied consistently throughout the periods presented in these financial statements.
Comparative figures have been restated where appropriate to ensure consistency with the current period.
Accounting estimates and judgements
The preparation of the financial statements requires the Board of Directors and management to make judgements, estimates and
assumptions which affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses.
Actual results may differ from these estimates. Estimates and assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised and in any future periods affected.
In applying the Group’s accounting policies, management has made the following judgements which have had the most significant
effect on the amounts recognised in the financial statements.
Impairment testing
There is a need to test for impairment of any tangible or intangible assets which are not already measured at fair value at each
reporting date.
At each reporting date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is
any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is
estimated in order to determine the impairment loss (if any). Where the asset does not generate cash flows that are independent from
other assets, the Group estimates the recoverable amount of the cash generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use.
If the recoverable amount of an asset (or cash generating unit) is estimated to be less than its carrying amount, the carrying amount of
the asset (or cash generating unit) is reduced to its recoverable amount. An impairment loss is recognised in profit or loss immediately,
unless the relevant asset is carried at fair value, in which case the impairment loss is treated as a revaluation decrease.
Key sources of estimation uncertainty
Goodwill impairment
Determining whether goodwill is impaired requires an estimation of either the higher of the value in use or fair value less costs of
disposal of the cash generating units to which goodwill has been allocated. The fair value calculation requires the entity to estimate
the expected earnings and an appropriate earnings multiple, and compare the fair value to the carrying amount of the cash generating
units’ assets to determine if any impairment has occurred. Key areas of judgement include deciding the earnings multiple of applicable
businesses.